[Federal Register Volume 82, Number 38 (Tuesday, February 28, 2017)]
[Notices]
[Pages 12107-12108]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-03888]


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FEDERAL TRADE COMMISSION

[File No. 162 3251]


SpyChatter, Inc.; Analysis of Proposed Consent Order To Aid 
Public Comment

AGENCY: Federal Trade Commission.

ACTION: Proposed Consent Agreement.

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SUMMARY: The consent agreement in this matter settles alleged 
violations of federal law prohibiting unfair or deceptive acts or 
practices. The attached Analysis to Aid Public Comment describes both 
the allegations in the draft complaint and the terms of the consent 
order--embodied in the consent agreement--that would settle these 
allegations.

DATES: Comments must be received on or before March 24, 2017.

ADDRESSES: Interested parties may file a comment at https://ftcpublic.commentworks.com/ftc/spychatterconsent online or on paper, by 
following the instructions in the Request for Comment part of the 
SUPPLEMENTARY INFORMATION section below. Write ``In the Matter of 
SpyChatter, Inc., a corporation, File No. 162 3251'' on your comment 
and file your comment online at https://ftcpublic.commentworks.com/ftc/spychatterconsent by following the instructions on the web-based form. 
If you prefer to file your comment on paper, write ``In the Matter of 
SpyChatter, Inc., a corporation, File No. 162 3251'' on your comment 
and on the envelope, and mail your comment to the following address: 
Federal Trade Commission, Office of the Secretary, 600 Pennsylvania 
Avenue NW., Suite CC-5610 (Annex D), Washington, DC 20580, or deliver 
your comment to the following address: Federal Trade Commission, Office 
of the Secretary, Constitution Center, 400 7th Street SW., 5th Floor, 
Suite 5610 (Annex D), Washington, DC 20024.

FOR FURTHER INFORMATION CONTACT: Monique Einhorn, Attorney, (202) 326-
2575, Bureau of Consumer Protection, Federal Trade Commission, 600 
Pennsylvania Avenue NW., Washington, DC 20580.

SUPPLEMENTARY INFORMATION: Pursuant to Section 6(f) of the Federal 
Trade Commission Act, 15 U.S.C. 46(f), and FTC Rule 2.34, 16 CFR 2.34, 
notice is hereby given that the above-captioned consent agreement 
containing consent order to cease and desist, having been filed with 
and accepted, subject to final approval, by the Commission, has been 
placed on the public record for a period of thirty (30) days. The 
following Analysis to Aid Public Comment describes the terms of the 
consent agreement, and the allegations in the complaint. An electronic 
copy of the full text of the consent agreement package can be obtained 
from the FTC Home Page (for February 22, 2017), on the World Wide Web 
at: http://www.ftc.gov/os/actions.shtm.
    You can file a comment online or on paper. For the Commission to 
consider your comment, we must receive it on or before March 24, 2017. 
Write ``In the Matter of SpyChatter, Inc., a corporation, File No. 162 
3251'' on your comment. Your comment--including your name and your 
state--will be placed on the public record of this proceeding, 
including, to the extent practicable, on the public Commission Web 
site, at http://www.ftc.gov/os/publiccomments.shtm. As a matter of 
discretion, the Commission tries to remove individuals' home contact 
information from comments before placing them on the Commission Web 
site.
    Because your comment will be made public, you are solely 
responsible for making sure that your comment does not include any 
sensitive personal information, like anyone's Social Security number, 
date of birth, driver's license number or other state identification 
number or foreign country equivalent, passport number, financial 
account number, or credit or debit card number. You are also solely 
responsible for making sure that your comment does not include any 
sensitive health information, like medical records or other 
individually identifiable health information. In addition, do not 
include any ``[t]rade secret or any commercial or financial information 
which . . . is privileged or confidential,'' as discussed in Section 
6(f) of the FTC Act, 15 U.S.C. 46(f), and FTC Rule 4.10(a)(2), 16 CFR 
4.10(a)(2). In particular, do not include competitively sensitive 
information such as costs, sales statistics, inventories, formulas, 
patterns, devices, manufacturing processes, or customer names.
    If you want the Commission to give your comment confidential 
treatment, you must file it in paper form, with a request for 
confidential treatment, and you have to follow the procedure explained 
in FTC Rule 4.9(c), 16 CFR

[[Page 12108]]

4.9(c).\1\ Your comment will be kept confidential only if the FTC 
General Counsel, in his or her sole discretion, grants your request in 
accordance with the law and the public interest.
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    \1\ In particular, the written request for confidential 
treatment that accompanies the comment must include the factual and 
legal basis for the request, and must identify the specific portions 
of the comment to be withheld from the public record. See FTC Rule 
4.9(c), 16 CFR 4.9(c).
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    Postal mail addressed to the Commission is subject to delay due to 
heightened security screening. As a result, we encourage you to submit 
your comments online. To make sure that the Commission considers your 
online comment, you must file it at https://ftcpublic.commentworks.com/ftc/spychatterconsent by following the instructions on the web-based 
form. If this Notice appears at http://www.regulations.gov/#!home, you 
also may file a comment through that Web site.
    If you file your comment on paper, write ``In the Matter of 
SpyChatter, Inc., a corporation, File No. 162 3251'' on your comment 
and on the envelope, and mail your comment to the following address: 
Federal Trade Commission, Office of the Secretary, 600 Pennsylvania 
Avenue NW., Suite CC-5610 (Annex D), Washington, DC 20580, or deliver 
your comment to the following address: Federal Trade Commission, Office 
of the Secretary, Constitution Center, 400 7th Street SW., 5th Floor, 
Suite 5610 (Annex D), Washington, DC 20024. If possible, submit your 
paper comment to the Commission by courier or overnight service.
    Visit the Commission Web site at http://www.ftc.gov to read this 
Notice and the news release describing it. The FTC Act and other laws 
that the Commission administers permit the collection of public 
comments to consider and use in this proceeding as appropriate. The 
Commission will consider all timely and responsive public comments that 
it receives on or before March 24, 2017. You can find more information, 
including routine uses permitted by the Privacy Act, in the 
Commission's privacy policy, at http://www.ftc.gov/ftc/privacy.htm.

Analysis of Proposed Consent Order To Aid Public Comment

    The Federal Trade Commission (``FTC'' or ``Commission'') has 
accepted, subject to final approval, a consent agreement applicable to 
SpyChatter, Inc. (``SpyChatter'').
    The proposed consent order has been placed on the public record for 
thirty (30) days for receipt of comments by interested persons. 
Comments received during this period will become part of the public 
record. After thirty days, the Commission will again review the 
agreement and the comments received, and will decide whether it should 
withdraw from the agreement and take appropriate action or make final 
the agreement's proposed order.
    This matter concerns alleged false representations that SpyChatter 
made to consumers concerning its participation in the Asia-Pacific 
Economic Cooperation (``APEC'') Cross Border Privacy Rules (``CBPR'') 
system. The APEC CBPR system is a voluntary, enforceable mechanism that 
certifies a company's compliance with the principles in the CBPR and 
facilitates privacy-respecting transfers of data amongst APEC member 
economies. The APEC CBPR system is based on nine data privacy 
principles: Preventing harm, notice, collection limitation, use choice, 
integrity, security safeguards, access and correction, and 
accountability. Companies that seek to participate in the APEC CBPR 
system must undergo a review by an APEC-recognized Accountability 
Agent, which certifies companies that meet the standards.
    Companies under the FTC's jurisdiction are eligible to apply for 
APEC CBPR certification. The names of certified companies are posted on 
a public-facing Web site, www.cbprs.org. Companies must re-apply 
annually in order to retain their status as current participants in the 
APEC CBPR system. A company that falsely claims APEC CBPR participation 
may be subject to an enforcement action based on the FTC's deception 
authority under Section 5 of the FTC Act.
    SpyChatter is an app that is designed to enable private messaging. 
According to the Commission's complaint, SpyChatter has set forth on 
its Web site, http://www.spychatter.net/privacy-policy/, privacy 
policies and statements about its practices, including statements 
related to its participation in the APEC CBPR system.
    The Commission's complaint alleges that SpyChatter falsely 
represented that it was a participant in the APEC CBPR system when, in 
fact, it never sought or obtained certification.
    Part I of the proposed order prohibits SpyChatter from making 
misrepresentations about its participation in any privacy or security 
program sponsored by a government or any self-regulatory or standard-
setting organization, including, but not limited to, the APEC CBPR 
system.
    Parts II through VI of the proposed order are reporting and 
compliance provisions. Part II requires acknowledgment of the order and 
dissemination of the order now and in the future to persons with 
responsibilities relating to the subject matter of the order. Part III 
ensures notification to the FTC of changes in corporate status and 
mandates that SpyChatter submit an initial compliance report to the 
FTC. Part IV requires SpyChatter to retain documents relating to its 
compliance with the order. Part V mandates that SpyChatter make 
available to the FTC information or subsequent compliance reports, as 
requested. Part VI is a provision ``sunsetting'' the order after twenty 
(20) years, with certain exceptions.
    The purpose of this analysis is to facilitate public comment on the 
proposed order. It is not intended to constitute an official 
interpretation of the proposed complaint or order or to modify the 
order's terms in any way.

    By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. 2017-03888 Filed 2-27-17; 8:45 am]
 BILLING CODE 6750-01-P